LA Times Article On "In Store Clinics Look To Be A Remedy For Healthcare Law Influx"

Gary Friedman/Los Angeles Times

In being a healthcare law lawyer, it is important to see ahead and get ahead of the curve. For years, I have been telling my physician clients about the trend for stores like Walmart to have in-store clinics and the need for clean, professional cash clinics. Especially with the large number of uninsureds or insureds with high deductibles - cash clinics for primary care issues like physicals, flu, etc. have a niche.

I have seen the trend in insureds going to a cash clinic in Los Angeles where they can see a physician or physician assistant or $50 for a routine matter because they do not want to pay a $20 copay on top of another $150 deductible.

Stores like Walmart, CVS and others were willing to open these clinics and know that they were going to make money on the ancillary services. With California's strict rules on the corporate practice of medicine, we have not seen many of these in store clinics. However, we see independent optometry practices at Target and Costco that comply with the prohibition on the corporate practice of medicine.

For those interested in the topic, the Los Angeles Times article "In Store Clinics Look To Be A Remedy For  Healthcare Law Influx" explores how these in-store clinics are looking to the fact that more people will be insured in the future. The article gives an example of a mother who took her son to a CVS clinic for a physical for sports for $49 because her son's insurance would not cover it until August and it would cost $150 at his physician's office. Look at what the big players are doing in healthcare when thinking about your own approach to your practice.

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Recent Success Story: Nursing Student With Recent DUI Given Unrestricted RN License After Appealing Denial Of License

Last summer we had a victory in an appeal of a denial of an RN application before the Board of Nursing. This cases are more common now since the Boards are much stricter on rejecting license applications if there is a prior conviction - especially one for driving under the influence.  

A summary of the facts and strategy will show how these cases are handled and can be guided to a successful result or "win."  Although this was a RN application, the process is similar to other types of licensees when they are denied licenses and appeals are filed.

Factual and Procedural Background Surrounding 
Appeal from Denial of a License. 

• In December 2010 while in an RN program, the nursing student was convicted of driving under the influence of alcohol and placed on 3 years probation. There were no other convictions or other alcohol or drug-related problems in his background.
• In September 2011, while still in his RN program, he filed an application to take NCLEX-RN. He did not have counsel and submitted his own letter regarding the DUI conviction. I often find that early representation by counsel helps create a better package and record of mitigation and rehabilitation. 
• In November 2011, the Board of Nursing asked for more information regarding the criminal conviction. The nursing student still did not have counsel and handled the response himself. While he did his best, it was not how we would have recommended proceeding.
• In December 2011, the Board of Nursing denied the application for licensure by examination based on the recent DUI conviction with a high blood alcohol content. At this point, we were hired and filed a timely Notice of Appeal. 
• We immediately began to work with our client and prepared a significant mitigation package that had a lot of different moving parts, letters, reports and documentation. We began negotiations with the Deputy Attorney General assigned to the case on behalf of the Board of Nursing. 
• It took four months to get the mitigation package completed that we wanted and it was submitted to the Board through the Deputy Attorney General. The typical settlement for this type of case is a provisional license that requires the licensee to be on probation once the NCLEX is passed, and those terms are negotiated. 
• Due to the strength of the mitigation package and work we did and had our client do, in May 2012 the Board of Nursing declined to pursue any discipline against the client and he was approved to take NCLEX and the case was transferred to the licensure department. 
• In July 2012, our client was notified that he had passed his NCLEX and became a licensed RN. 

This was a great win since it would have been very difficult for our client to get hired if he had been on probation. It would have cost him a great deal of money over three years in lost income while on probation and would have been a permanent mark on his record that would have hurt his career. We estimated there would have been more than $100,000 in lost income and saved expenses over 10 years. Every case is different and this client was willing to work hard and do all the things needed for us to make him shine before the Board. 

Posted by Tracy Green, Esq. Please email Ms. Green, a very experienced nurse attorney, license attorney, and board hearing attorney at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation. 

Tracy Green Quoted In Sac Bee Article "Legislation Aims to Crack Down On Illegal Medical Spas"

Robert Kneshke/Shutterstock

Medical spas are the latest focus in California's legislature. Tracy Green was quoted extensively in an article in the Sacramento Bee entitled "Bill Aims to Crack Down on Illegal Medical Spas" by journalist Anika Anand.

Why is this such a big issue in California? First, California has some of the strictest laws prohibiting the "corporate practice of medicine" in the United States. In plain English this means that in Californa a business corporation which is not owned by a physician or is not a professional medical corporation (at least 51% owned by a physician) can NOT employ a physician or nurse to provide professional medical services. There are some exceptions for hospitals and HMOs.  Some states like Arizona and Nevada do not have these laws and allow non-physicians to own medical practices.

Second, this is about money. Dermatologists, plastic surgeons, and other physicians are seeing business people open "medical spas" offering Botox, Juviderm, laser hair removal and other "medical" treatments at a lower cost because they do not have a physician on site and are undercutting prices and taking their business. The ability to get patients to pay cash (no insurance reimbursement) for these cosmetic and anti-aging medical procedures is a big draw since our aging population is willing to pay for these procedures.

Third, people opening medical spas do not hire attorneys at the outset -- even for a couple of hours -- to make sure they are complying with state laws. There are so many medical businesses that do not comply with the laws that they fail to realize they are violating state laws and are committing felonies. Failure to understand the laws is not a defense to the unlicensed practice of medicine charge.

Fourth, this crackdown follows Medical Board hearings regarding the level of supervision of nurses who perform cosmetic procedures such as Botox injections and laser hair removal. There was a push for higher level of supervision for these procedures but that could adversely affect nurses' ability to perform procedures in hospitals and clinics that are not cosmetic related. The increased enforcement seems to be a result of those hearings.

Finally, the Medical Board seems to be using these criminal cases in order to deter others and send a message out to the medical community. If an individual hires a physician to be a medical director and a nurse to perform Botox or laser hair removal - it is a felony or misdemeanor of practicing medicine without a license. It is a Business and Profession Code violation and under the current laws no one need prove intent to defraud or criminal intent. The physician can be charged with aiding and abetting the unlicensed practice of medicine as well. This means it is easy for the government to shut down illegally structured medical spas, execute search warrants and charge the individuals involved. 

How many medical spas are in California? We do not know. Medical spas are not required to register with any official government agency, so there is no way to obtain an exact count. The legislature's concern is that a significant number of the "medical spas" are operating without proper medical supervision. California is currently proposing to strengthen its laws governing medical spas and in the meantime the Medical Board is initiating criminal investigations and cases against medical spas that are not legally compliant.

In my opinion, this crackdown and proposed legislation is unnecessarily detrimental. The maximum fine would be increased from $1,200 to $50,000 and the jail time would also be increased substantially. This would unfairly target those unfamiliar with the existing operating guidelines. There are more effective ways to ensure compliance with business regulations than criminalizing the conduct.  While I understand the importance of compliance and have worked in my own practice to help various spas achieve fully compliance, this new law would be overly harsh. For physicians and nurses, the criminal charges could adversely affect their licenses.

Extreme criminal charges are heavy-handed unless the case involves repeat offenders or people who have been told that this is the law. Rather than focusing so many resources on intensive investigation and prosecution, the state should be concentrated on making people aware of the proper way to operate these types of businesses.

For further reading on this matter, please refer directly to the Sacramento Bee article where I am quoted. In the meantime, the key word is get compliant as soon as possible and seek legal advice BEFORE you open your medical spa business. If you have already opened a medical spa or aesthetic medical practice, get compliant ASAP.

Posted by Tracy Green, Esq. Please email Ms. Green, a very experienced health care attorney and medical spa attorney at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.  

Recent Nursing Trend: Nurses Going Back To College For 4-Year Degree To Meet New Requirements

The New York Times' article "More Stringent Requirements Send Nurses Back to School" (June 23, 2012) highlights more stringent requirements that hospitals and other employers are requiring of R.N.s in today's world. Hospitals which often pay the best, especially teaching hospitals, are beginning to require a 4-year degree for hiring. It is time to consider more education in order to stay competitive in the marketplace.

I have also been encouraging my nurse clients with 4-year degrees to consider becoming advanced practitioners such as Nurse Practitioners or Certified Nurse Midwifes since that gives them the ability to practice more independently under a physician's supervision. It makes practice in a private setting more rewarding as well.

Posted by Tracy Green, Esq. Please email Ms. Green, a very experienced nurse attorney, at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.

Indiana Doctor Pleads Guilty To Excessive Prescribing - Is Your Practice Complying With State And Federal Laws And Guidelines?

On June 22, 2012, an Indiana doctor Ray Howell plead guilty to charges that he excessively prescribed narcotics and his plea agreement included surrendering his medical license. Indiana officials claimed that Dr. Howell issued over 11,000 prescriptions in a year. Howell plead guilty to 5 felonies including unlawful distribution of oxycodone. The DEA and state law enforcement are concerned that in some parts of the country prescription drug abuse has overshadowed methamphetamine and other unlawful drugs.

Howell's case is a reminder to physicians of what can go wrong in pain management. For those physicians who dispense pain medications as part of their practice it is important to learn from such cases without being fearful of prescribing narcotics. There is a legal way to prescribe controlled substances for intractable pain.

The law in California is that "No physician and surgeon shall be subject to disciplinary action by the board for prescribing or administering controlled substances in the course of treatment of a person for intractable pain."  Cal. Bus. Prof. Code Section 2241.5(c). How do you as a physician ensure that you fall within this law?

The first place to start is to review the California Medical Board's Guidelines for Prescribing Controlled Substances for Pain. This is a summary of the standard of care for managing pain patients. It has detailed advice that you are expected to know before you prescribe narcotics for pain management.

Second, review and comply with the DEA's Practitioner Manual to ensure you are complying with federal rules and regulations. It is usually the DEA who sends in undercover patients and initiates investigations when the CURES reports show a large number of prescriptions from a physician. There are more cases of state and local law enforcement getting involved in undercover operations as well but the DEA is in the forefront.

Third, seek legal and expert advice to make sure that your practice is compliant with existing laws, regulations and medical standard of care. If you did not comply with the existing rules in the past, it is not too late to change your practices and become compliant.

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.

Any questions or comments  should be directed to Tracy Green, a very experienced California physician attorney at tgreen@greenassoc.com. The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers in California and throughout the country. Their website is: http://www.greenassoc.com/

Owner of Sports Bars Charged With Under-Reporting Payroll Faces Felony Charges For Unemployment And Workers’ Compensation Insurance Fraud And Filing False Tax Return With EDD

Everyone has always known that underreporting payroll or paying employees cash under the table could result in tax issues or civil liability if a worker is injured. However, now such actions can result in criminal charges. Therefore, paying an employee cash off the books can be a serious liability risk for companies and its owners.

In a recent case, not only was the owner of a California business charged with unemployment and workers’ compensation insurance fraud but she was also charged with filing a false tax return with the California Employment Development Department (EDD).

Renee Anne Vicary, age 51 years, allegedly owned and operated four businesses: Angels Sports Bar and Gentleman’s Club in Corona; Angels Sports Bar and Grill in Anaheim; Angels Roadhouse in Yucaipa; and Angels Roadhouse in Apple Valley. Angels Sports Bar in Corona was featured on an episode of the Spike TV show “Bar Repair” in July 2011 during which it was renamed Racks Billiards and Bourbon.

According to the the Riverside County District Attorney’s (RCDA) Office, the investigation began nearly two years ago after they received information that Ms. Vicary was underreporting her employee payroll at the Corona location. It is common that investigations begin by someone reporting the wrongdoing (often former employees).

The RCDA alleges that the insurance policy listed Ms. Vicary as employing four employees at each of the Corona and Anaheim businesses and three employees at each of the two San Bernardino County businesses. Investigators allege that Ms. Vicary actually employed more employees at each of the four locations than found on the insurance policy.

Following this discovery, search warrants were served at all four businesses as well as Ms. Vicary’s Corona home and several financial institutions. It took many months for EDD and three insurance companies used by Ms. Vicary to complete audits. Once those audits were done, it was alleged that losses were in excess of $340,000. She was then charged by the RCDA’s Office with the following felonies: (1) filing a false tax return with EDD, (2) failure to collect and pay tax to EDD, (3) willful misrepresentation to obtain insurance, and (4)  willful misrepresentation to obtain Worker’s Compensation Insurance.

Ms. Vicary was arraigned on June 13, 2012, in Dept. 41 at the Hall of Justice in Riverside, following her surrender in court on an arrest warrant that was issued last month. She entered not guilty pleas and has a felony settlement conference scheduled for August 13, 2012.

A felony complaint is only an accusation and is not evidence of guilt. Ms. Vicary is presumed innocent and is entitled to a fair trial at which the government must prove guilt beyond a reasonable doubt.  

If convicted as now charged, Ms. Vicary faces up to a maximum of 14 years, four months in prison even though such a high sentence is very unlikely in this case. Typically in these cases, the amount of restitution paid is a factor in plea negotiations. The case is being prosecuted by the RCDA’s Insurance Fraud Unit.

Attorney Commentary:  This case shows how small businesses can get into criminal trouble for bad business decisions that did not used to be prosecuted as crimes. Some employees may even ask to be paid cash for their own purposes (liens, support obligations, etc.) and employers have to be careful not to do “favors” for their employees and pay them cash. All it takes is one accident at work, one cash employee filing for unemployment or a disgruntled employee to create a criminal case. It’s simply not worth it in today’s world.

What is the fraud? The DA’s Office alleges that the business failed to put the employees on payroll to save money in workers’ compensation premiums and EDD insurance. Even if that was not the company’s motivation, the company would have submitted paperwork under penalty of perjury regarding total payroll to EDD and its workers’ compensation insurance carriers with payroll totals that do not reflect the amounts paid to cash employees.

The State runs EDD and collected the unemployment insurance premiums and has decided to criminalize this conduct rather than conducting audits and collecting the money. If you face an audit, it is important to engage an attorney early and avoid having these type of investigations escalating. It is not clear what went on during the years that Ms. Vicary’s businesses were being investigated but often if the audit is handled early in a professional manner with a repayment for premiums or cash employees, a criminal case can be avoided. Every case is different but it is important to understand that each county DA office has special units for these types of cases and there is a trend towards more aggressive prosecutions of these offenses.

We have represented many employers for issues with underreporting workers' compensation premiums including issues where employees where paid cash, misclassified as independent contractors or with lower risk job titles and related issues. The earlier counsel is obtained, the better since waiting until after the audit is completed and the case is referred out makes it more difficult to resolve. We evaluate the issues and seek to ensure that mistakes and errors do not appear to have the indicia of purporseful underreporting.  

Posted by Tracy Green, Esq. Please email Ms. Green at tgreen@greenassoc.com or call her at 213-233-2260 to schedule a complimentary 30-minute consultation.  

Tracy Green is a very experienced California insurance fraud attorney, worker's compensation premium fraud attorney and Los Angeles white collar criminal defense attorney.

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil,administrative and criminal proceedings. They have a specialty in representing companies and individuals in insurance fraud related matters in California. Their website is: http://www.greenassoc.com/